This pair came into the week with mixed signals—evidence was there for longs as I wrote earlier in the week but there was also a confirmed head and shoulders pattern on the charts. The drop looked like that could be the overriding factor but the pair hasn't been able to move lower than .8455, a fib level and price support. Now it has climbed back to the bottom of the downward channel on the daily chart where it will either fail for sure or lumber back in and head up from its bear trap. On the weekly chart (not shown), it's hard to say the wave structure looks anything but corrective with wave C over. Should be an interesting week next week.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
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